Sunday, March 29, 2009

So do you know whats in your wallet?

I am concerned. Nikkei down 1 3/4% as I write this, Rick Wagoner has been "asked" to resign, and across the board most pre-market indicators are down by what would be 100 pts on the DJA.

Thats not the REAL DEAL, as yet. The REAL DEAL as I see it, is that a HEDGE WARNING was issued by myself on Thursday LAST, under the heading "NUCLEAR SCARENARIO".

Whereas I have no idea WHETHER or to WHAT EXTENT that idea will pan out, I do know the market is correcting, probably in equal measure to its previous advance, so having cash to ACQUIRE specific CANDIDATES at SUPPORT LEVEL depends upon your prudence in these specific moments. You will note I have advocated use of TRAILING STOP LOSS LIMIT ORDERS.

Observe that in the middle of correction turbulence, deploying them may not either be feasible or yield satisfactory results. Prudence suggests you protect yourself.

Whilst 32 of the 40 stocks selected since Jan 1 have profited in the Educational Investment Simulation, clear NEGATIVE INDICATIONS are ongoing, and have resulted in Selling Execution by TRAILING STOP LOSS LIMIT ORDERS. Clear negative indications are visible in 30 of the 40 issues under scrutiny. One stock looks as if it cannot be taken lower, but until this correction is over, the jury is out there.

If this correction is the garden variety like a "Pray & Spray" drive by shooting, that would be a plus, rather than more serious incursion like the St. Valentines Massacre or Nuclear Scarenario.

IMO opinion, this time calls for vigilance and prudence. Whats in your wallet?

DG

Friday, March 27, 2009

OH dear ME, you will Drop over lauging if you link

to this one: As much as this is a parody, it rings true. "Let the FORCE be with you!"

http://www.greenrewards.co.uk/GreenTV.aspx

Ya'll have a nice weekend, fight nice, no kicking, eye-gouging or biting ! ! !

DG

Thursday, March 26, 2009

NUCLEAR SCARENARIO - Nightmare on Main St.


kinda like what some guys said back at the beginning of 2009, a one or two day pop down to 5k on the DOW ! ! Likely ?? I dont know. Possible. YES, Psychologically, mathematically and logically, YES, YES and YES.

Techically speaking, $4954.44 is the lower Bollinger Band [ 3.0, 30 ] on the weekly DOW 1 year chart. Mathematically possible for an INTRA-DAY Target, YES.

$ 4954.44 on the DOW would Satisfy all DOWNSIDE OBJECTIVES.
IT WOULD PLAY HELL ON EVERY PORTFOLIO, AND VIRTUALLY WRECK EVERYONE, running all the stops, and panic'g everyone to sell out at the bottom. But what would be the point at selling out there? NONE !

IF such a move had happened back in January, it might well have signalled the end of markets as we know them. IT DID NOT HAPPEN.

Were such a move to happen now, it WOULD literally knock the DOW back to it's support from the beginning of the REAGAN BULL MARKET. In todays world of instant & amazing volatility, it wouldnt last too long.

So "WHATS IN YOUR WALLET" ? Says the guy in red with the pointy horns and tail on the CAPITAL ONE commercial. Are you prepared for HELL Freezing OVER? Dont put your tongue on any metal objects yet.

I guess "Preparing for Hell freezing over" means you have reasonable stops under your positions, and an awareness and readiness to be in a BEAR ETF or SELL Options for cash, if the circumstances warrant . SO SIMPLE A CAVEMAN COULD DO IT ! !

And to quote a noteble and possibly appicable phrase from the Christian Bible as I remember it
:"...for no one shall know the appointed hour when HE shall return, for HE shall come as if a thief in the night...." [ I know its a paraphrase but you get the idea ].

If the results of a possiblity are CATASTROPHIC, HEDGE AGAINST IT...... WHAT's in your WALLET?

I think I have said enough.

DG



Tuesday, March 24, 2009

GURU's CARPET BOMB INVESTORS WITH INFORMATION OVERLOADS



Oh here we are again. "ITS A RALLY" ; "ITS ONLY A BEAR MARKET RALLY, xxxxxxxxxx DONT GET SUCKED IN" ; xxxxxxxxxxx "IT'S A BULL MARKET IN BEAR'S CLOTHING" ; xxxxxxxxxxxx "THE RALLY WONT CORRECT" ; xxxxxxxxxx "THE RALLY IS GOING TO CORRECT".

Honestly folks, how much of this can anyone take before emotional exhaustion. ? ? ? The CHICKEN LITTLES are screaming "THE SKY IS FALLING", Bernacke is trying to sound like a FREE-MARKETEER, and the OBAMA Team has finally figured out how to use the PPT.

So what are investors with a wit of sanity left, to do ?

STAY ON THE CORRECT SIDE OF THE INTERMEDIATE TREND ! ! ! PERIOD.

HOW CAN ONE HOPE TO DO THAT ?

USE THE MACD SIGNALS FROM THE CHART AT THE TOP OF THIS PAGE TO POSITION YOUR MOVES AND EXECUTIONS. Accept the fact that you will suffer at times, after all investing is a RISK-BEARING proposition.

Use this link to access the free charts at www.stockcharts.com

http://stockcharts.com/h-sc/ui?s=$NYAD&p=D&b=5&g=0&id=p48588850371

Feel free to hate me for saying so, but no one said this would be easy.

My best advice is to study MACD behavior, and work from there. At least you only have one factor to cope with, not umpteen GURU's each with a differing opiniion WHY. The MACD does NOT care WHY, it digests what everyone has discounted to-date and quantifies it in an understandable graphic form. Use wisely, your results will vary.

In the end, you wont know WHY either, but if PROFITS are more important than knowing WHY, you might want to look at the MACD.

GOOD LUCK ALL

DG

THE RALLY that wouldnt DIE ! !




Or is it the "Tale of Two Rallies"?

Either way it doesnt matter too much. At times there would seem to be a two tier market, one for the LARGE CAPS, and one for everyone else.

This matters NOT, as this Rally shows itself "ROLLING OVER", like a tall ship off the coast of Labrador in October, with so much ice forming in the rigging that it slowly heels over.

The TALKING HEADS are OOHHing and AHHHing about the strength of Monday's rally and how we have only given back a quarter of MONDAY's Advance. Good enuf. I wonder what they will be saying later this week? PRICE BOTTOMS AFTER BREADTH. That is a lesson well illustrated during the latter parts of 2008 and early 2009.

Now after a gander at the Exaggerated Momentum turn-about Chart[ GOLD COLOR ] at the 2nd from the top of the page, will indeed lead you to question the idea that this Rally is not correcting. Breadth-wise the correction has been underway for about FOUR sessions, despite yesterday's rally. Yesterday's Rally was in fact, the kind of fireworks that lend a smoke screen to what is actually going on.

If you use the above chart to gauge when turns REALLY occurred, it is apparent that although the rally APPEARED to TURN upward from March 6th on, the actual turn in BREADTH MOMENTUM occurred about Feb 23. BREADTH LEADS PRICE.
PRICE LAGS MOMENTUM. Its like observing a beautiful fireworks display while pickpockets are working the crowd, and suddenly you realized you've been robbed.

The time of that last UP-CYCLE from Valley to PEAK was 15 market days. Likely the decline as measured above will run from 10 to 20 market days.

If you are using free charts, on www.stockcharts.com, you can use: http://stockcharts.com/h-sc/ui?s=$NYAD&p=D&b=5&g=0&id=p48588850371
will create the TOP chart for you, so that you yourself can COUNT the days UP and DOWN and get a bit of a clearer picture of when things are actually moving, and which way.

In the next post I will steal a headline I liked from an email I got yesterday.

Good Luck All

DG

Friday, March 20, 2009

OK TIME FOR A HEADS UP.

At this Point I am hedging both my precious Metals and Energy Positions against a developing downside movement.

Both of these items, PM & ENERGY, are balanced, as if on a knives edge, and since this is both a TRIPLE WITCHING WEEK and DAY, Caution is on my plate today.

DG

Thursday, March 19, 2009

ok, EVERYONE got the WARM FUZZIES





And just when you think it is SAFE, what happens? ? ?

W.o.W, WALL of WORRY, has it gotten too comfy yet? Should we be scared? Well how about VIGILANT, instead of scared.

ABOVE is a chart from the" FLAWLESS" series, with some markers removed to improve its viewing characteristics.

So now we DONT think we will crash straight to 5000 HELL in a handbasket, at least not yet !

But the 3 of the 3 Banded Oscillators in in Extreme Over Bought positions. Two of these are heeling over like a sailing ship with too much ice overweighting the rigging and superstructure, and the MACD is de-accelerating.

Psychologically everyone is starting to breathe more easily, and is a wee bit complacent.
So as both Stalin and Napoleon said, the more dangerous time in a war, was after it seemingly was won. I submit, that is the case here for a correction either NOW or very shortly.

No matter what you follow, be it Bank Indexes, Liquidity Indexes, or phases of the moon, I suggest you take a deep and serious look at them RIGHT NOW, and plan accordingly.

The Wilshire 5000 [$WLSH] is as representative as it gets, of the entire market, so when it speaks, I heed its words. You might be well advised to observe them also.

Friday morning I will be exploring my hedge options for a number of issues. Its it conceivable that the DJ breaks under 6400 ? YES. Likely, ?? Probably not. FOR CERTAIN? no one knows, all we have is hints and clues. My best guess is that after all the dust clears here, the rally will still be alive in one form or the other. Be that as it may, take this call for VIGILANT ACTION FWIW. ! ! ! Guessing at reversal levels, I'd say that you could expect a correction to stop at a downside level of 6800 on the DOW and perhaps 7300 on the $WLSH. GIVEN volatility we have now, that could be ONE DAY's worth of a hellacious move, and surprise no one. I would not be surprised to see it stop in the 7K region of the DJ and 7.5 region of WLSH.

To put it all in perspective, BOTH of these AVERAGES are bouncing btwn their 20 & 50 DMA's, so it would be logical that each of those would provide an intial Point of Reference.
For that reason, I'd expect the bounces in that area, but re aware a DOWNSPIKE, designed to scare you out of your liver, could take the DOW down to its old low for a test, and the same for the WLSH, BUT, that would likely be INTRADAY, if at all. IF it closed under the old low, well that'd be a signal, and a bad one.

Tight lines to ya, and if ya need luck, well "break a leg" as they say in show biz and hope its sumptin big and hairy.

Good Luck All

DG

Wednesday, March 18, 2009

New concept, new challenge

Last time I moved, my darling wife and I sat down and made some hard choices.
We took all that we needed and nothing we
didn't, and moved 4,000+ miles, taking everything that fit those criteria into our Mazda Pickup.

My concept is pretty simple. I read so much about many and I occasionally see an "ATTITUDE OF GRATITUDE" from the occasional writer. Those of us who have Internet Access are so
privileged in the scheme of things on this Planet, that I encourage all to adopt that "ATTITUDE of GRATITUDE. My commitment is to lighten up on my material goods by 50% by the summer.

On this LINK Doll's Journey you'll see my darling wife's challenge, which I am also taking. I invite you to challenge your concepts and consider taking this challenge along with us. What could it hurt?
LOL.

Best,

DG

Tuesday, March 17, 2009

OK FREAK-OUT over CRASH OVER, for now

looks like we getting a normal correction. Watch it, enjoy it.

DG

A word to the wise ->

BECAUSE the DJIA [ most watched ] has so rapidly bounced upwards off the 6400 level and almost reached the 7500 level, as called for in ONE Scenario, I have been soul-searching and researching every possible technical indicator at my disposal to determine if this "CORRECTION" could turn into a DEBACLE that took us straight to 5000. Yes it is possible, at least from a view of one Breadth Momentum indicator. NO, IMO, it is not the likliest thing to happen, but you have got to admit, stranger things have happened.

I am watching ASIA and will be sampling the Pre-Market. Several Indicative measures including a number of flavors of MACD Do NOT favor this extreme development manifesting, but that doesnt mean a hard correction wont scare the liver out of you.

SHOULD you feel UNTOWARD developments unfolding, you may HEDGE by ACQUIRING
TZA, which is a BEAR ETF, reproducing 3X the INVERSE Move in the $RUT. Here you must DYODD & DYOHW. Even in a basic downturn, TZA will move hard and fast. DO NOT get into TZA unless you know wish to take that risk in order to hedge your NON-PM Holdings.

Two of Three of my indicators combining differing processes DO NOT CONFIRM this manifestation of a straight move to 5000 now. That may or may not change, but I will post any changes as soon as I know them.

Good Luck All,

DG

Sunday, March 15, 2009

HERE is WHY I vote for LOCK & LOAD


NICE CHART, eeh? THIS is a 3 LINE BREAK chart of a popular BREADTH INDEX.

To me it says the BULLS will be taking "NO-PRISONERS", as they climb the "WALL OF WORRY".

I havent found a more graphic way to display this, until now.

Keep your powder dry and use limit orders.

GOOD LUCK ALL

DG

OK, is it time for LOCK & LOAD, or CUT and RUN?



So now you ask yourself, what TOP-SECRET mumbo-jumbo am I looking at NOW?

What you see IS what you get. AND it is Nick-Named the ITCHY Chart by me.
ITCHY is the short form of ICHIMOKU, a form of projection, evolved back in the
1930's by some Financial News Editor's in Japan. The rough translation is:
EQUILIBRIUM At-A-Glance. Thats about what it gives me. I combine it with the MACD to give me an idea of the movement dynamics [ THE Dance], rather than volume in a stock.

My basic premise here is this rally will continue to climb the "Wall of Worry" even if it does worry us some with a correction or consolidation here, which would be normal, logical and desirable. THEREFORE, if you choose to enter this market, to ACQUIRE, Limit orders at SUPPORT, below market are in order. If you cant figure support, you can always use the STOCKCONSULTANT box in the right hand corner for a reasonable look at SUPPORT.


As I use this for a model, I came up for some BUY SIGNALS for MY use . USE THEM At YOUR OWN RISK ! ! ! Feel free to reproduce this chart in the FREE sections of

www.stockcharts.com

MY only parameter here for a BUY SIGNAL was the POSITION and CROSS-OVER of the MACD Signal.

So for BUY signals I came up with the following potential ACQUISITIONS FOR ME.

PLEASE BE FOREWARNED if you to to acquire any of these issues that I expect the market to re-trench this week before a rally continues. Wrong tho I might be, dont be surprised if you enter any of these issues and fail to show a profit immediately. You may enter a LIMIT BUY Order under the market and see if anyone takes that bait. YOUR CALL, I say ! !

AAUK ; PGH ; WTU ; APL ; SSL ; DEJ ; RBY : MFN ; LBLCF [L.to] ; NGA ; EAD ; GAB ; IM ; STX .

It would not be surprising to see the market sag as you go to ACQUIRE any of these issues.

Next on my menu were the PM stocks and only ETQ and GGN have triggered a positive BUY signal NOW. ETQ is in the process of being acquired, rumor has it so, excercise care in what you pay for it. GGN on the other hand holds a variety of issues and engages in option writing to create income, which hopefully supports that nice dividend.

MDW, THM and MFN are closest to CLOSING the MACD gap which would give a buy signal.
Positive price movements would in fact trigger a closing of that GAP.

Of the Gold Stock Indexes, GDX is farthest from triggering an MACD BUY SIGNAL, but still close. $XAU, the most senior of the indexes is a hair's breadth away from triggering a BUY SIGNAL upon the closing of the MACD GAP.

Do as you will with these as you know their volatility.


Good Luck All

DG

Friday, March 13, 2009

How about a touch of INCOME ?

OK, for a spot of income, anyone??

Yields as you like them. Sectors, Capital Gains Potentials, and get paid while you wait.

Again, in no particular order : PGH ; BGS ; DHT ; EAD ; GAB ; HRZ ; GGN ; SSL ; AAV ; MWE ;
PVX.

For those digging deeper, there still is the Canadian INCOME TRUST FUND sector, some of which are USA Listed, or simply OTC or Pink Sheets : LIF/un.to ; RSI.un.to ; PMT/un.to ; SIF/un.to. For more detailed information, you can access most of them on www.tsx.com.
Most of the Trusts can be found on www.stockcharts.com, using the above format to create a chart.

Each and every issue here, usually responds to a sector, so if you can observe the sector it will aid your understanding of how it cycles.

Observe Support [ usually the same as ACQUISTION ZONES ] and Resistance [ similar to DISPOSAL ZONES ], for the best oppurtunities.

Good Luck All,

DG

OK, now for all the Odd ones

how about a TRIPLE Bull ETF for the Small Cap Financials ? > FAS.

Maybe a Double Leverage CRUDE long? > DXO.

Triple Bull Real Estate ?? > URE.

TRIPLE BEAR Small Caps > TZA.

Thats enuf to get you into lots 'o mischief ! !

Good Luck All,

DG

"Get your Motor runnin" - Now for some ENERGY [stocks ]

Energy and related stocks currently tracked, again in no particular order, are : AAV ; MWE ; CFW ; PVX ; DXO ; DNR ; APL ; WTU ; TLM ; SSL ; UNT.

Again, you know the "drill". I think most "energy" related measures would be best used in conjunction with an banded oscillation chart, to anticipate moves in these issues.

Also other "Energy" issues showing some activity here are : IVN ; EEE ; YZC ; AAUK ; DEJ.
AZC is in Copper. PLM is into a poly-metallic deposit in Minnesota.

Every issue here has its own product composition and development position, which I'd think you'd be most comfortable "doing the drill", ya know, DYODD & DYOHW.

Good Luck All,

DG

AND for OUR NEXT Performers, we have PM's

These are on my radar at the present moment, again, in no particular order : AZK ; EGO ; MDW ; FRG ; KGH ; CEF ; GORO ; IAG ; THM ; GGN ; RBY ; ETQ ; MFN ; AXU ; RIC ; EGI ; MMG ; QMM.

Now given the many strange circumstances and places miners must go to get PM's, I can safely say everyone of these PM's stocks has their own story, which it would be best to be familar with before entering any position. Thats my advice. Most will fluctuate mainly with PM prices, but all are vulnerable to their own internal developments. Again, the same kind of Technical Selection as to ACQUISITION and DISPOSAL ZONES applies here as it did to the INDUSTRIAL - LIKE stocks.

Good Luck All

DG

Lets talk Industrials [ or non-PM, non-Energy stocks]

Issues I am tracking that fit this category are [in no particular order ] : FHC ; NWK ; DAR ; BGS ; DHT ; L.TO[ aka LBLCF ] ; NGA ; EAD ; IM ; STX ; HRZ. My apologies for anything I left out.

I am tracking these with a series of technical analysis filters and ACQUIRING and DISPOSING of them as they arrive in these respective zones. These ZONES are roughly equivalent to those found by using the STOCK CONSULTANT Box in the upper right of this blog. Should you run out of ENTRIES for this, you can use the O/S & O/B ZONES on any particular Banded or Stochastic Oscillator. If that doesnt work, just either leave a comment for me, or email me at "denaliguide2@yahoo.com" and I will publish the most recent for that particular issue.

My basic premise is that these "INDUSTRIAL-Like" stocks will participate in this Rally. We will talk about THE RALLY later and its ramifications.

Good Luck All,

DG

AND it shall come like a thief in the night, and no one shall know the date of the return

Does this not adequately describe what just took place?

Like WWII, while the occupants of Hong Kong looked to a sea-borne invasion, the invaders came by land. And took the colony.

Was someone looking for a capitulation style bottom? What they got instead was a market that was indifferent to almost ALL classes of assets. Was it not more comfortable to clutch rabid skunks to your bosom, than to buy common stocks ?

So no blog or DGS Letter reader was surprised to see this rally. Further, no reader who followed a prudent course of ACQUISITION at SUPPORT Levels, protected by trailing stop, suffered inordinately, and yet still was positioned to participate in this rally. They no doubt are participating in this rally yet.

And of course, our nemisis, the TALKING HEADS were DEAD WRONG, as ALWAYS at Market TURNS. They were TOTAL BEARS on MARCH 6th & 9th, God Love Them ! ! !

I hope you guys are enoying your profits now and moving your trail stops up gently behind them.

In my next post I am going to cover some of the ISSUES I have been following.

Good Luck All,

DG

Tuesday, March 10, 2009

THREE Amigos meet Pancho & Cisco

Doing my scans I run across some strange stuff.

Here are the Three Amigo's + Pancho & the Cisco Kid : EEE [ coal ] ; MDW [ gold ] ; DEJ [ nat gas + U308 ] ; CFW [ heavy oil recovery ] ; and AZC [ copper ]. All are for educational investment simulations and instructions in Risk-Bearing. All are under 1 buck, and all are REAL Businesses, and have both positive and negative attributes.

Good Luck All

DG

"To Be or Not To Be?"

from Hamlet. We already know that something is rotten in the State of Denmark, Germany, USA, und so weiter. OK.

But can the market rally? Well, somewhere between Scenario # 3 and Scenario #4 lies the possibility that the market will, In FACT, rally off a close that was the Day's Low,but yet a HIGHER close than the previous day. This simple fact is a slender thread upon which to pin ANY hopes, but, aside from the facts of BREADTH, ( which in fact, is what $WLSH is part of with 5000 stocks included ), it is what we have, i.e. "Let your ends be dictated by your means."

I'd say you must now countenance that fact that a rally could extend upwards from here, which is in ONGOING as I type.

DG

Sunday, March 8, 2009

AND NOW A WORD FROM OUR SPONSORS: KIVA.org and Now SHELTER BOX

Likely those of us who read this, have benefit of "Rule of Law", and probably Food, Clothing and Shelter for the forseeable future. Our worries and cares are, in fact, tiny when compared to those on this Planet who struggle daily for their subsistance and a safe place to live.

While we cannot readily change that, there is something we can do. As my favorite military author, B.H. Liddell-Hart, Cpt, RET. once penned, "Your objectives should be dictated by your means."

In this respect I urge you include in your giving, consideration, SHELTER BOX, Canada
[ http://www.shelterbox.ca/]. The provide temporary shelter to those suffering from
disasters such as Seismic, Fires & Floods, in places where this is no help. It is the helping hand we'd all want to have if our home burnt, if we suffered a tsunami, or if we'd been turned out of our homes by EarthQuake at the beginning of winter.
For Americans, SHELTERBOX can be accessed at: http://shelterboxusa.org/

SHELTERBOX originated in the UK, and can also be accessed there and in Australia and NZ.

The only thing I need to remember is : " There but for the grace of God, go I."
Having been lost one home to fire 6 days before Christmas, I know a little bit of what it feels to
be as a refugee, desperate and seemingly without hope.
Prepared to camp in the middle of winter is one thing, but having lost the means to care for oneself and family during the onset of winter is one of the most terrifying moments I think a human can endure.

FWIW, I try to provide my site as a service and so would any wish me profit from this blog, please translate that into positive things for SHELTERBOX and KIVA, if you would.

SHELTERBOX is an efficient volunteer organization, and I know my contribution went directly into helping the afflicted without administrative expense, which is great. Thanks for your attention to this unvarnished commercial message.

Good Luck All,

DG

"DO I FEEL LUCKY TODAY ?"

Ok, so we have SCENARIO's. If any one cares to have to see some similar or supporting arguments WHICH I HAVE READ, just email me for them.

WHY I FEEL LUCKY :

1/ BEEN THERE, DONE THAT. Kinda like the silly paragraph,


"We the willing, led by the unknowing, had done so much with so little,
that we now feel qualified to do anything with nothing."

Thats Kinda how I feel.

Since the November Lows I have participated in rallies and had mixed results, but I am still here, somewhat bent, spindled and a wee bit mutilated, but with a still operative sense of humor to show for it all.

2/ I am as prepared for everything out there as I can be, sans the end of the world, which of
course, no one can ADEQUATELY prepare for.

WHAT are my PREPARATIONS, market-wise ?

A/ I hold stocks in positive trends with safe dividends, ACQUIRED at Panic Levels.
B/ These holdings are NOT on Margin, they are 100% owned.
C/ As a Precious Metals Partisan, I hold several Precious Metal Stocks NOW in
Positive Trends, some paying protected Dividends.
D/ I have a Pre-Positioned NEGATIVE ETF HEDGE Plan ready for deployment
as any ensuing Rally Approaches its Likely EXHAUSTION LEVELS.
E/ MY Hedge will render my portfolio MARKET NEUTRAL, whereas the
Dividends will continue to flow to my portfolio.
Adjusting the amount of NEGATIVE ETF I hold relative to my Portfolio
will allow me to roll my exposure fore and aft, more and less to
either positive or negative trends, by simply buying or selling shares
in said NEGATIVE ETF.

DO YOU FEEL LUCKY TODAY ? ? Dyodd & DYoHW, and you just might. ! ! !

DG

Now that the Market showed it could rally, are you ready to have Your Hopes CRusHED AGAIN?

IT COULD HAPPEN. ! ! ! Who would be surprised by this ? Certainly NOT ME.

What are OUR hopes, our fears ? Our hopes are that the market will turn upward in a spring surge. Our Fears are that we will will be plunged into the Abyss of the UNKNOWN, as we already have been.

So what is being feared is fear itself, to paraphrase FDR. If you look at the slaughter of the PM's Juniors, the decimation of the general market, the plague visited upon the Small Caps, and the
general screwing of the public by the Powers That Be, I say, what is really to FEAR since we
all have BEEN THERE, DONE THAT ? I got the Tee Shirt, and the video. The TEE Shirt I since gave to the Salvation Army and the Video I burnt. If you "Been There, Done That", then you have a guide ! ! !

Lets examine the options, as outlined by several Pundits, whom have been good, not uncanny, but often right.

1/ The market Rallies hard, in electronic speed, to 7500 [ DJIA ] and crashes back to 5000 or so, from whence a Super Rally, ala, "1931", ensues.

2/ The market Crashes hard, in electronic speed to 5000 ala 1932, and stays there [ " L " shaped Depression Coming soon to a town near you ].

3/ Market engages a "Punch - Thru" rally that pierces Upside Resistance @7500 and runs to
10,000, again from then whence no one has a clue what will follow.

NOW that we have outlined those options [ this is NOT an exhaustive list of the options ],
Let us EXAMINE how each of these Options would satisfy some of the 'likely' technical momentum criteria.

A/ Options #1 Could easily reduce the OVERSOLD Compression Pressures in the Breadth Arena, such that these measures could enter the OVERBOUGHT Ranges and render such an advance as Option #1 outlines, seriously Vulnerable to a" INSTANT Crash to 5K" Scenario.
Such an happening, IMO> would likely result in a then, hard and sustainable rally to higher levels. I guessimate the possibility of this happening at 25% for the next 2-3 days.

B/ Option #2, Market Crashes to 5000 directly from here, and stays there, does not Pass Go, nor collect $200.
This would complete SUPER supercede all data for this modern era and set new records for oversold levels portending the end of the world as we know it. I assess the likelihood of this, at
Less than 10% for the next 2-3 days.

C/ Option #3, Direct "PUNCH - THRU" RAlly vaults all resistance and runs right to 10K from here. I assess the likliehood of this as Less than 10% for the next 2-3 days.

My particular conclusion is that we will experience some conclusive action, and if I were a bookie, I'd suggest that we experience enuf Rally to relieve the HISTORICALLY Extreme OVERSOLD Compression in the Breadth Measures, as as they approach their Exhaustion Levels, either a Crash or Drift down to Levels MARGINALLY lower than this LEVEL, wherefrom a more sustainable Rally will result.

WHY ? I Seldom speak of the WHY's because I DONT KNOW THEM. BUT if I had to again guess, I'd suggest that we are awash in liquidity, that the RE-Flation Stimulus Measures are so HISTORICALLY Extreme, that as ANY minor amount of this slops over in the Equity Markets, it will be sufficient to prime the pump to then jump start a rally, after the operative emotion, FEAR, has been softened a bit more.
To its further support, values here are approaching panic levels [ yields of going concerns demonstrate such, IMO ! ], and such Compression in Values as caused by said panic, will need be
lessened in order to ripen the condition for further declines, so Rally will become the temporary path of Least Resistance.

DG

Wednesday, March 4, 2009

YES THIS IS A RALLY !! This week is THE WEEK

where it has to rally or die. Well, the world does NOT end today. If it had not rallied by the end of this week, one would wonder. I think the market will rally back to the LEFT Shoulder Level of an INVERTED Head & Shoulders, and pause for cause there. Were it to form a RIGHT SHoulder and then EXCEED it, RALLY Higher than it, then it would change things. ODDS are that it WONT, but stay tuned.
DGS Letter has it, so get your No-Charge Subscription by E-mailing "denaliguide2@yahoo.com" and you will receive it by return email.

Good Luck All

DG

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